Performance Reviews Are Broken. Here’s What Works Instead
Performance reviews were designed to enhance growth and clarify expectations. But for many organizations, they’ve become stale rituals that inspire more dread than development. Employees approach them with anxiety. Managers rush to complete them. HR departments chase signatures and checklists. Meanwhile, very little actually improves.
So what went wrong?
And more importantly, what works better?
In this article, we’ll break down why traditional performance reviews fail, what employees actually need to grow, and how organizations can reimagine performance conversations to drive results and engagement.
The Problem with Traditional Performance Reviews
Let’s start with the obvious: most employees and managers dislike annual reviews.
A Deloitte study found that 58 percent of executives believe their current performance management approach drives neither employee engagement nor high performance1. According to Gallup, only 14 percent of employees strongly agree that performance reviews inspire them to improve2.
The symptoms of a broken system include:
Delayed feedback. Once a year is too late to course correct or recognize progress.
Generic criteria. Vague categories like "collaboration" or "initiative" are rarely defined or contextualized.
Manager bias. Subjectivity and recency bias skew results, making reviews feel unfair.
Low trust. If feedback is only given during review season, it creates tension instead of development.
Focus on ratings, not growth. When the goal becomes a number instead of a conversation, improvement gets lost in translation.
These flaws don’t just impact morale. They impact business. Without clear feedback loops, employees don’t know where to grow, and leaders don’t know how to guide them.
What Employees Really Want
If traditional reviews fall flat, what do employees actually need?
They want clarity, consistency, and a chance to grow. According to a study by PwC, nearly 60 percent of employees say they would like feedback on a daily or weekly basis—a number that jumps to 72 percent for employees under age 303.
Employees don’t want to wait for a form to tell them how they’re doing. They want to know:
Am I contributing in a meaningful way?
What am I doing well?
What should I improve?
What opportunities exist for my development?
They crave honest conversations with their managers—conversations that align their strengths with the team’s success and chart a path forward.
This means the solution isn’t scrapping performance management altogether. It’s transforming it.
What Works Instead: A Better Model
Let’s walk through a more effective model for performance conversations—one that is rooted in frequency, context, and coaching.
1. Continuous Conversations, Not Annual Events
The most effective feedback happens in real time. Instead of one high-pressure conversation a year, shift to a cadence of brief, consistent check-ins. These might be:
Monthly development conversations
Quarterly progress reviews tied to goals
Weekly one-on-one meetings that include space for feedback
Regular feedback reduces anxiety and allows for timely support. Small corrections throughout the year make big corrections unnecessary.
2. Manager as Coach, Not Judge
Instead of rating performance from a distance, encourage managers to step into a coaching role. A coaching mindset shifts the focus from judgment to development.
Good performance conversations include:
Open-ended questions like, “What felt challenging this month?” or “What are you most proud of?”
Shared reflection on successes and growth areas
Specific, actionable feedback based on observed behavior
Joint goal-setting to support growth
This approach builds trust and increases motivation.
3. Clear Expectations and Shared Ownership
Performance fails when expectations are unclear. Start with defining success in each role. What does excellence look like? How is impact measured? How does each person contribute to the broader goals of the organization?
Create scorecards, goal frameworks, or competency maps that make performance tangible. But don’t let these tools gather dust. Use them as part of ongoing conversations.
Ownership matters too. Employees should be part of the process, not just recipients of feedback. Invite self-assessments. Ask them to reflect before you do. Empower them to suggest development goals and career aspirations.
4. Real-Time Recognition and Course Correction
Celebrate wins as they happen. A simple “great job on that client pitch” or “you asked a thoughtful question in today’s meeting” reinforces what you want to see more of. Real-time recognition is a powerful motivator.
Likewise, course correct when you see something off-track. Address missteps immediately, not six months later. Doing so prevents resentment, misunderstandings, and unnecessary performance issues.
According to SHRM, 89 percent of HR leaders agree that ongoing peer feedback and check-ins are key for successful outcomes4.
Implementing a New System: Practical Steps
Train Your Managers
Shifting from boss to coach doesn’t happen overnight. Offer training in feedback delivery, coaching techniques, active listening, and emotional intelligence. Managers who feel equipped are more likely to lead meaningful performance conversations.
Standardize Just Enough
Too much structure can stifle authenticity. Too little creates inconsistency. Find the middle ground. Offer conversation guides, templates, and check-in questions—but leave space for flexibility.
Reevaluate Metrics
What gets measured gets attention. Make sure your metrics match the outcomes you want to see. If collaboration is key, measure it. If client satisfaction is the goal, tie performance to that. Move away from generic scoring toward customized, meaningful metrics.
Make Feedback a Two-Way Street
Performance conversations shouldn’t be top-down. Encourage upward feedback. Ask employees what they need from their manager. What’s working for them—and what isn’t?
This exchange creates a culture of continuous learning and shared accountability.
The ROI of Getting It Right
Companies that shift to a continuous performance model see measurable benefits:
Employees are 3.6 times more likely to be engaged when managers provide daily feedback2
Organizations with strong performance management practices are 1.5 times more likely to outperform competitors financially5
Teams with high feedback cultures experience less turnover, more innovation, and higher trust
Final Thought
Performance reviews are not dead. But the old way of doing them should be.
What employees want and what modern businesses need is a performance culture built on consistency, coaching, and clarity.
It doesn’t require more time. It requires more intention.
When leaders give meaningful feedback regularly, employees don’t just perform. They thrive.